City Pacific seeks to frustrate unit holders

We can confirm that a notice has been lodged with ASIC under the Corporations Act requiring the regulator to register Trilogy as the new responsible entity of the City Pacific First Mortgage Fund.

We can also confirm that:

Before the unitholders meeting last Thursday (June 25), City Pacific applied to the Federal Court for an injunction to prevent the meeting from occurring. This failed.

At the meeting, and following the appointment of a unitholder as Chairman, the unitholders overwhelmingly carried a resolution to remove City Pacific as responsible entity and appoint Trilogy in its place. Computershare calculated that more than 87% of units voted at the meeting were voted in favour of the resolution.

We believe that City Pacific has no interest in listening to the members that it allegedly represents indeed, the day after the meeting, City Pacific again instituted Court proceedings for summary judgment to invalidate the meeting. This again failed.

City Pacific also sought an injunction to prevent Trilogy from lodging a notice of change of responsible entity with ASIC in order to delay its removal. This also failed.

City Pacific further sought that the hearing of the matter occurs in late August. From this action we can only assume that City Pacific wishes to remain as responsible entity for the interim period, which in effect would enable it to continue charging fees well beyond that which Trilogy has agreed to charge and use Fund assets to pay for the litigation.

The Court has not been prepared to let this matter wait and required lodgment of City Pacific's amended statement of claim by July 3 before a directions hearing on July 6.

BalmainTrilogy is concerned that the overwhelming, clearly stated and valid demands of the members, as evidenced by their vote, to replace City Pacific is being frustrated by City Pacific desperately trying to delay its inevitable removal.

It is clearly a matter of great discomfort to the majority of unitholders that City Pacific is prepared to disregard the unitholders best interests and bring court action after court action, at the expense of members to overturn the clear wishes of the members.